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The common perception of identity theft involves unauthorized access to a bank account or misuse of a credit card. However, there is another form of identity theft that can be more elusive. Criminals use personal information, such as your name and Social Security number, to open new accounts in your name. The problem is escalating quickly. Javelin Strategy & Research reported a 31% increase in victims of new-account fraud in 2025, jumping from 4.2 million to 5.4 million cases. This was the steepest rise among tracked fraud types.
A fraudulent account could be for a credit card delivered to an unfamiliar address, a phone or utility account with a new provider, or a buy now, pay later account using your identity. The sneaky nature of this fraud means criminals may not access accounts you monitor actively, leaving no suspicious charges for you to notice in a bank statement. A strange bill, a lender checking your credit, a debt collector’s call, or an unfamiliar account could be your first clue. Proactively searching for these signs is essential before the situation worsens.
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New-Account Fraud: A Growing Threat
This type of fraud is notably difficult to detect because criminals can open accounts without involving those that victims regularly monitor. See how new-account fraud typically unfolds:
- With current account fraud, unusual purchases trigger alerts, or your card stops working.
- New-account fraud can progress quietly, as a criminal creates an account using your information.
- The new account is linked to contact points controlled by the criminal.
- Clues might include unexpected credit report inquiries, accounts, or welcome mail for unfamiliar services.
- Not all account types are reported on all credit reports, adding to detection challenges.
Expanding personal data breaches give criminals more information to exploit. Phishing attacks and records from data brokers have made it easier for them to impersonate identities effectively. Additionally, the convenience of online account applications allows criminals to use stolen identities seamlessly. Even the Federal Reserve warns against fraud risks linked to digital account openings, exacerbated by sophisticated technology.
How Identity Theft Begins
A single breach may not provide all necessary details for identity theft. Instead, information such as your name and email might come from one breach, with older breaches exposing more data. People-search sites may complete the puzzle with addresses or phone numbers. Criminals then test your identity across various firms. This explains why identity theft often seems random—the information may have been around for a long time before misuse.
Detecting Fraud Evidence
Evidence of new-account fraud can appear in surprising places:
- Your credit reports: Examine reports from Equifax, Experian, and TransUnion for unfamiliar inquiries and accounts. Free weekly reports are available at AnnualCreditReport.com.
- Unexpected mail and email: Look for communication related to accounts you never opened.
- Debt collection calls or letters: Investigate unfamiliar debt collection attempts.
- Phone, utility, buy now, pay later activity: These accounts may evade traditional credit reports.
- Unfamiliar addresses or information: Investigate unexpected entries alongside odd accounts or inquiries.
Steps to Investigate Fraud
There are proactive measures to check for fraud:
- Pull all three credit reports: Visit AnnualCreditReport.com for comprehensive reviews from Equifax, Experian, and TransUnion.
- Search for unfamiliar details: Identify strange accounts, inquiries, or addresses.
- Consider a credit freeze: Make it harder for new accounts to be opened; freezes are free and reversible.
- Monitor mail and email: Stay alert for messages regarding unauthorized accounts.
- Enable monitoring and alerts: Free account alerts from banks and credit companies can help.
Responding to Fraudulent Accounts
If you discover an unrecognized account, act swiftly with these steps:
- Contact the company: Reach out to the fraud department of the company where the account was opened to close or freeze it; keep documents confirming your actions.
- Report identity theft: Visit IdentityTheft.gov to create an FTC Identity Theft Report and recovery plan.
- Implement a fraud alert or credit freeze: Initiate a fraud alert or credit freeze via the major bureaus.
- Dispute fraudulent information: Contact credit bureaus with fraudulent account details for blockage.
- Enable monitoring and alerts: Obtain identity monitoring services if needed.
- Maintain a record: Keep documentation of all communications and actions taken.
Conclusion on Vigilance
New-account fraud demands attention since criminals can completely avoid accounts you regularly check. Use services to pull free credit reports, identify unfamiliar accounts, and consider a credit freeze. Monitoring empowers you to catch changes quickly. The quicker the response, the more manageable the impact.
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